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Fiat-Chrysler’s car sales tumble, Fiat-Chrysler still number one

FCA's car volume may be collapsing in Canada, but FCA is still outselling all other automakers

After Fiat-Chrysler Automobiles’ Canadian passenger car sales tumbled 18 percent in 2015 and began 2016 with a 49 percent drop, FCA can still say no manufacturer is capable of selling more new vehicles in Canada. Not during the 2015 calendar year; not in January 2016.

It’s an apparent contradiction, but such is the strength of FCA’s Jeep and Ram brands and the undying affection Canadians have for Windsor, Ontario-built minivans that the automaker’s disappointing car results are quickly overlooked.

Doomed?

FCA’s CEO, Sergio Marchionne, was vocal in his expectations for the automaker’s Dodge Dart compact prior to its release in 2012. “If you’re a serious carmaker and you can’t make it in this segment, you’re doomed,” Marchionne told 60 Minutes in 2012.

Marchionne surely disagrees with that categorization now that the floundering Dart (and oversupplied Chrysler 200 midsize sedan) have been deemed so ineffective that FCA won’t directly replace the current generations with new FCA-developed cars. FCA will likely sell compact and midsize cars in the future, but they’ll be sourced from outside the company.

The industry’s six-percent drop in total new passenger car sales last year doesn’t explain away FCA’s difficulties. In 2015, the Dart lost 60 percent of its Canadian volume, year-over-year. Fewer than one percent of the compact cars sold in Canada last year were Darts. Among continuing nameplates, only the smart fortwo posted a year-over-year decline worse than the Dart’s, but the smart was in the midst of a transition from second- to third-generation models.

2016 did not begin on friendly terms with the Dart, either. Sales last month plunged 76 percent to only 111 units, or one Dart for every 33 Honda Civics. In Canada’s largest vehicle category, Canada’s largest manufacturer is virtually a non-entity.

Midsize

Total FCA midsize car volume slid 10 percent in 2015. 2016 began with a 51-percent year-over-year loss. Harsh reviews from Consumer Reports; poor transmission reliability; and steep discounts, which gave the new 200 a bargain-basement image almost immediately after launch, conspired to take the sheen off FCA’s renewed midsize effort once consumers learned more about the car.

In fact, it faced criticism right at the top of the company, from Sergio Marchionne himself. Referring to the Hyundai Sonata, Marchionne told Automotive News, “We didn’t copy the car, we copied the entry point to the rear seat. Dummies. I acknowledge it.”

Outside of the core compact and midsize markets, FCA Canada is left with vehicles that compete in low-volume categories. The Dodge Charger and Chrysler 300 are major players among large, full-size, volume brand sedans. But they combined for half as many Canadian sales in 2015 as in 2007.

In 2015, the Dodge Challenger achieved its second-best Canadian sales year since returning in 2008. Yet with only 2,669 sales, the Challenger is a relatively small fish in a small pond dominated by the much more popular Ford Mustang. Only 232 Dodge Vipers and Alfa Romeo 4Cs were sold in Canada in 2015—sports cars aren’t the answer.

One of Fiat-Chrysler’s most high-profile vehicles is the Fiat 500. The 500, however, is now five years old in Canada, and the little Fiat wasn’t a new design when it arrived here in early 2011. Fewer than 3,000 were sold last year, a 65-percent decline compared with 2012.

The larger 500L bombed from the start. Only 5,326 copies of the 500L have been sold in Canada since its arrival in mid-2013. Kia Canada, for comparison’s sake, can sell that many Souls in five months.

Solutions

With all of the automaker’s success and volume coming from SUVs, crossovers, pickup trucks, and vans – and none of the automaker’s success and little volume coming from cars – it’s not surprising to see FCA’s SUV-focus. Assuming that fuel prices will remain permanently low reeks of optimism. But believing that the global appetite for utility vehicles will remain healthy is a belief shared by rival automakers.

Ford plans to plug four more holes with utility vehicles by 2020. GM is about to launch a Chinese-built Buick to slot in between the Encore and Enclave. Just as premium automakers attacked the entry-level portion of the car market with so-called affordable luxury, they’re doing so now with entry-level crossovers. Think the Audi Q3 is small? Wait until you see the Audi Q2.

Only 10 percent of the new vehicles sold by Fiat-Chrysler’s Canadian outpost in 2015 were cars. In January, that figure plunged to five percent. That would be a frightening figure for an automaker like Honda or Hyundai or Volkswagen, but FCA sells so many other vehicles, the car decline is tolerable. Sales of FCASUVs, crossovers, pickups, and vans jumped six percent to 17,212 units, more than the total overall sales of any other automaker.